The Centre for Social Concern (CfSC) has called for a review of the Consumer Price Index (CPI), which measures changes in the price level of market basket of consumer goods and services.
CfSC economic governance programmes officer Lucky Mfungwe said this yesterday on the backdrop of RBM maintaining its inflation targets set out in the first quarter of 2018.
According to RBM spokesperson Mbane Ngwira, the central bank maintains its target of attaining annual inflation rate at 9.3 percent in 2018, 9.7 percent in 2019, 9.3 percent in 2020 and 5 percent in the first quarter of 2021.
Mfungwe, however, said since the levels of price changes in Malawi are heavily dictated by weather and climate change, attaining such targets would be dependent on agriculture output.
“Unfortunately, the formula for inflation doesn’t take this variable into consideration. Already, the current inflation figures and the projections are questionable as they do not really translate or trickle down to a common Malawian.
“Perhaps we need to move a step away from paperwork economics and appreciate the real situation on the ground,” he said.
The International Monetary Fund (IMF) earlier said managing the volatility of inflation will take time, given Malawi’s well-known vulnerability to shocks.